Tuesday, November 10, 2009

All We'll Hear In 2010 Is Jobs, Jobs, Jobs

Soon the Democrats will have their healthcare victory. It may be a hollow victory that barely resembles their initial goals, but it will be declared momentous and beneficial to all Americans. We will have more laws and taxes for the sake of illusive healthcare improvements. Any consequences of the legislation, such as debt, increased taxation and job losses, will be several years away, so the celebration can begin.

With some sort of a healthcare victory behind Obama and the Democrats, they can turn their attention to what Americans are really concerned about. That is the economy and job creation. The party in power has been slow to realize that healthcare reform is not the voters number one priority. In 2010 the Democrats will innundate us with job creation legislation.

Just like healthcare costs and coverage, job creation can either be nurtured simply and effectively, or politicians can talk big, tinker, and accomplish little. Rest assured, Obama will get a jobs bill and victory will be declared. No, he won't accomplish an improvement in employment by simply lowering corporate income taxes or the highest personal, marginal rates paid by business owners of Sub Ss or LLCs. That would never happen as it would make sense. Jobs legislation will need to be targeted so social goals and constituencies can be served. Power must be preserved. The mid-term elections must maintain the Democratic majority and 10+ percent unemployment will not accomplish that. So, let the jobs tinkering begin.

What private sector growth can Democrats tolerate? The list is short: green jobs in sustainable energy, unionized workforces in manufacturing, the entertainment industry, design and construction of government building projects, data processing that consolidates and improves medical recordkeeping, and agriculture. These constituencies are apt to receive extra assistance.

We will see a general investment tax credit for the purchase of capital goods or additional employment. Capital goods purchases and employment growth in targeted industries will see an expanded tax incentive. Wind and solar projects, energy efficient appliances and transportation, almost any item manufactured and exported by a union member, will attain special status in the name of job creation. Rebuilding the construction industry with unionized labor by funding more school and transportation projects. None of this will be called stimulus as that has become synonymous with wasteful spending. In 2010 we will have job creation. Democrats will attempt to sound like Republicans.

Capital goods manufacturers that export will see an ITC driven sales boom on top of the weak dollar benefit.The likes of Cat, Deere,Trinity and Valmont, among others, will see revenue growth. Even in a "U" recovery some stocks will appreciate and select American manufacturing companies may benefit from Obama's next victory. Forget about the additional debt and taxation that will accompany, like healthcare reform, the job creation "success"as it won't cause credit and inflationary problems for several years. It will be a "victory" or the Republicans will get a chance to get change correct.

Back to stocks, Deere, while certainly not cheaply priced, is an unionized exporter that serves the agriculture and construction industries and might be a place to park a few dollars while Obama creates jobs,jobs,jobs.

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